Home | MIT Sloan Fellows | Leadership Blog

Category: Sustainability

What it takes to reach win-win

What is the true art of the deal? Is it about who can be more forceful? The most manipulative? Bruno Verdini believes a successful negotiation is when everybody leaves the table satisfied. Executive director of the MIT-Harvard Mexico Negotiation Program and author of the new book, “Winning Together: The Natural Resource Negotiation Playbook,” Verdini studied negotiations between the United States and Mexico over hydrocarbon drilling rights. What he learned was how conflicts can be resolved through proactive collaboration.

Verdini explored age-old disputes between the two countries regarding the hydrocarbon reservoirs in the Gulf of Mexico and environmental and water resources from the Colorado River. In 2012, following a decades-long stalemate, the countries developed joint agreements that have been implemented, enhanced, and renewed. What changed?

The U.S. had historically enforced the “rule of capture,” specifying that if a company drills into a reservoir on the U.S. side, regardless of whether the reservoir crosses the border, it is entitled to all extracted oil. Mexico protested what it considered a unilateral ruling that put it at a disadvantage, but it was also laboring under its own restrictive policies. Constitutional rulings forbid joint drilling between Petróleos Mexicanos (PEMEX), its national oil company, and energy companies outside of Mexico.

Negotiators for the two countries, finding themselves at an impasse in 2000, agreed to place a ten-year moratorium on drilling in the contested area. In 2010, they extended the moratorium for another four years, but this time, they set about resolving the core issue. Eighteen months later, the United States and Mexico signed a landmark agreement to overhaul all prior practices and incentivize their energy companies to develop shared hydrocarbon reservoirs.

Leaping the impasse

Verdini talked with negotiators from both countries. He wasn’t so much interested in the specifics of the agreement but in how the day-to-day communications unfolded. The lead negotiator for the United States, who had deep oil-industry experience, suggested that before the start of negotiations, the two groups participate in a series of collaborative workshops to develop a deeper understanding of each country’s goals and constraints. Working side by side in these monthly workshops, the participants came to understand one another’s points of view. The environment was friendly, positive, and productive, and in the end, the two negotiating teams built a solid rapport and sincerely wanted to come to a win-win conclusion.

“There’s evidence that one of the best ways to satisfy one’s own interests is to find an effective way to meet the core interests of the other side,” Verdini notes in an article published in the MIT Energy Initiative’s magazine Energy Futures. “Embracing a mutual-gains approach to negotiation implies switching away from the traditional, widespread, zero-sum, win-lose mindset in order to structure the negotiation process instead as an opportunity for stakeholders to learn about and respond to each other’s core needs. The result tends to be a more robust agreement that both sides experience and view as beneficial.”

Verdini’s research received Harvard Law School’s award for best research of the year in negotiation, mediation, and conflict resolution, the first time the honor has been awarded to faculty member based at MIT. He is now heading the development of a Mexico-based bi-national negotiation center devoted to training stakeholders and organizations.

Read more about Verdini’s research in Energy Futuresthe magazine of the MIT Energy Initiative.

Tiny houses offer big benefit to Seattle’s homeless

Homelessness in Seattle might not grab the national headlines as it does in cities like New York and Los Angeles, but the city has the third-largest homeless population in the country, behind those other two metropolises. Seattle-based MIT alumna Sharon Lee has found one inventive solution to the crisis—tiny houses.

Lee graduated from MIT in 1981 with degrees in architecture and city planning. She founded the Seattle-based Low Income Housing Institute in 1991 to provide a range of supportive service programs that allow residents to maintain stable housing and increase self-sufficiency.

The micro-dwellings measure 8 x 12 feet and are fully heated and electrified. Each cluster of 16 homes—seven clusters have been built across the city—is located on open land or in an unused parking lot. Each cluster is set up to be its own village with a communal kitchen and bathroom facilities. The city funds the utilities as well as full-time social workers and case managers to support the residents. Volunteers—many from trade organizations and schools—build the homes, which cost about $2,500 each to construct.

A catalyst for turning lives around

Because the tiny homes are under 120-square-feet, they aren’t considered a dwelling and can be built and made operational quickly with a relative minimum of red tape. “If you want to build a [traditional] building, it takes a year to get financing, a year to get permits, and a year to year-and-a-half to build,” Lee notes. “In the meantime, people are literally dying on the streets.”

Designed as a temporary solution, the homes have proven to be an effective vehicle for turning lives around. In the last two years, nearly 2,000 members of Seattle’s 10,000+ homeless citizens have taken advantage of the tiny house communities, and 300+ residents have moved on to permanent housing. More than 250 have gained employment. “It’s not a perfect solution,” Lee emphasizes. “It’s a crisis response.”

At LIHI, Lee oversees a staff of 140 engaged in housing development, management, advocacy, and support services. Her team has developed more than 4,500 units of housing, including tiny homes. In addition to recognition for its humanitarian impact, the organization’s efforts have won several local and national awards for design excellence and environmental sustainability.

“It is very emotional,” says Lee. “When we offer people a tiny house, they may have been on the street for four years and they finally move into a place that’s heated and where they can stay, and they’re just overwhelmed. Then they find that they can get their life together. They can address their health care, their mental health, and their employment situation because they can be stable.”

Read the story in the Slice of MIT blog.

Residents and staff discuss the benefits of tiny home villages.

MIT and Commonwealth Fusion Systems are forging the future of energy

Fusion power is a carbon-free, combustion-free source of energy that uses fusion reactions to produce heat for electricity generation—and it may well be the way we power our future lives. Read about how it works.

Visualization by Ken Filar, PSFC research affiliate

Although, it has been the dream of energy researchers for years, fusion power remained out of reach because of the investment necessary to develop it for practical use. MIT has just announced, however, that it is putting fusion power on the fast track. With $50 million from an Italian energy investor, the Institute and the new private company Commonwealth Fusion Systems (CFS) are preparing to launch a rapid research program leading to the development of a working pilot plant within 15 years.

The project was conceived by MIT Plasma Science and Fusion Center (PSFC) researchers Robert Mumgaard SM ’15, PhD ’15 (now the CEO of CFS), Dan Brunner, PhD ’13, Brandon Sorbom, PhD ’17, and Zach Hartwig PhD ’14, assistant professor of nuclear science and engineering at MIT. Director Dennis Whyte and Deputy Director Martin Greenwald will lead the effort, which will include a broad interdisciplinary team.

We need a new approach

Mitigating global climate change, Hartwig told MIT News, will require new sources of zero-carbon energy on a very fast track. “We are going to need a completely new approach to ensure that fusion energy can be a significant part of the solution. The hard reality of climate change is that every single nation that has ever industrialized and made a better life for its citizens did so at the expense of the climate. There is, at present, simply no other way to do this than to dump carbon dioxide into the atmosphere by burning fossil fuels for energy.”

CFS will join the MIT Energy Initiative (MITEI) as part of the new university-industry partnership designed to bolster MIT research and teaching on the science of fusion. MIT President L. Rafael Reif described the project launch as an important historical moment. “Advances in superconducting magnets have put fusion energy potentially within reach, offering the prospect of a safe, carbon-free energy future,” he said. “As humanity confronts the rising risks of climate disruption, I am thrilled that MIT is joining with industrial allies, both longstanding and new, to run full-speed toward this transformative vision for our shared future on Earth.”

See MIT Vice President for Research Maria Zuber’s op-ed in the Boston Globe.

Find out more about the MIT-CFS fusion project.

Read a Q&A with one of the project originators Zach Hartwig

Salesforce turns the San Francisco skyline green

Soon, the tallest building in San Francisco also will be the greenest. The 61-story Salesforce Tower opened its doors in early 2018 and is about to undergo construction of the largest on-site water recycling system in a commercial high-rise in the United States.

“Offices can be a physical expression of our values,” said Patrick Flynn, MBA ’12, senior director of sustainability at Salesforce. “The blackwater system was a natural fit for our mission.”

Blackwater? It’s wastewater from toilets, as distinguished from greywater, which comes from other household uses, like bathwater. Salesforce is installing the system in collaboration with the City of San Francisco and Boston Properties, and it’s expected to reduce the building’s water consumption by 76 percent and save up to 30,000 gallons of fresh water a day—that’s 7.8 million gallons a year, equivalent to the water consumption of 16,000 San Francisco residents annually.

The water-recycling infrastructure will take about six months to install, after which municipal agencies will perform extensive water quality tests. Salesforce expects the system to be up and running by early 2019. The building will collect water from a rooftop rainwater system, cooling towers, showers, sinks, and toilets then process it in a centralized treatment center to prepare it for reuse in toilets and drip irrigation systems.

Goal: 100% renewable energy

Flynn notes that Salesforce is committed to incorporating sustainability into all areas of its business. The company’s goal is to achieve 100 percent renewable energy over the next few years by building to LEED standards whenever possible and increasing its investment in virtual power purchase agreements.

Founded in an apartment on Telegraph Hill more than 18 years ago, Salesforce is now San Francisco’s largest tech employer. “We may have grown as a company over the years,” a company statement notes, “but our commitment to improving the state of the world through our business has never wavered. At Salesforce, real estate is more than architecture and design, it’s about creating a positive impact on all of our key stakeholders, including employees, partners, customers, communities, and the environment.”

Read the MIT Sloan News article.

Learn more about the project.

 

 

 

 

 

Graphic: Salesforce

Moving on your sustainability agenda

Sustainability has become an imperative for organizations, but when it comes to moving forward on that agenda, many are lost about where to begin. What can an organization do to become more energy efficient? What can manufacturers do to preserve water? What are the best practices for recycling in a large organization?

The ambitious cross-sector online platform SHIFT is making it easier for leaders of organizations large and small and at all stages of development to “hardwire” sustainability into their organizations. A collaboration led by the Sustainability Initiative at MIT Sloan and the management consulting firm Valutus, SHIFT is helping leaders to improve the trajectory of their progress.

SHIFT allows site visitors to search for tools according to the business goal they’re trying to achieve and to forge a path to implementation that’s right for their individual organizations. The sustainability frameworks and environmental, social, and governance resources on offer have been carefully curated by MIT Sloan’s team of researchers and practitioners.

Visitors to the site can search for resources by:

  • Sector (food and beverage; agribusiness, consumer products, energy, finance, healthcare, IT, infrastructure, retail, mining and metals)
  • Environmental issue (chemicals, energy, water, biodiversity, materials, waste, climate, land use)
  • Social issue (human rights, labor, diversity and inclusion, health and safety)
  • Governance (public policy, investor relations, executive management)
  • Job function (supply chain, human resources, operations, manufacturing, facilities, procurement)

One of the characteristics that sets SHIFT apart is its vast network. SHIFT is essentially a community of practitioners working together to curate and review tools based on their own experiences. The community includes hundreds of organizations—from multinationals like AT&T and Levi Strauss to nonprofits like the 2030 Water Resources Group and the New Climate Institute, from industry groups like the American Institute of Architects and the Retail Industry Leaders Association to government organizations like the U.S. Department of Labor and the U.S. Department of Agriculture.

SHIFT effectively crowd sources intelligence from organizations around the world, and as the number of contributors grows, so does the relevance and importance of SHIFT as a resource.

Check out the SHIFT website.

Read more about MIT Sloan’s Sustainability Initiative.

Pioneering water recycling technology wins MIT $100K grand prize

Every day, four thousand children die because they don’t have access to clean water. That stark fact is what drove the winning innovation at this year’s MIT $100K Entrepreneurship Competition on May 14. “The water crisis is only getting worse,” says Maher Damak, PhD ’17, cofounder of Infinite Cooling, the grand-prize winner. “Our mission is to help solve the water crisis and save power plants $10 billion a year.”

Nearly 40 percent of all the water drawn from lakes and rivers in the United States goes to thermoelectric power plants. Water is continuously dumped into cooling towers, where some evaporates to cool the remaining water. A 250-megawatt power plant spends $5 million on water every year and consumes an amount equivalent to 100,000 residential users.

Infinite Cooling is developing a system—based on Damak’s mechanical engineering thesis—that captures and recycles the vaporized water from thermoelectric power plants. The recycled water would be reused continuously in the plant’s cooling system

saving millions of gallons—and dollars—annually. The team estimates that its collector could capture 80 percent of the liquid water droplets in the air and cut a power plant’s water consumption by 20 to 30 percent. And the newly potable water could be shipped to water-scarce areas.

2018 Clean Energy Prize winner

Backed, in part, by funding from the MIT Tata Center for Technology and some of the country’s leading startup competitions—including the Clean Energy Prize—Infinite Cooling has developed a system that can be retrofitted on top of cooling towers, where it captures escaping water vapor. The system also eliminates the need for treating the water with thousands of gallons of chemicals before it’s recycled.

Cofounder and co-inventor Karim Khalil, PhD ’17, noted that because their device is able to collect this pure, recondensed water, “not only do we reduce the evaporated losses, but also [reduce] costly water-treatment requirements.” The startup is planning a seed round by the end of the year and a Series A in 2020. It is also exploring applications of its technology in refineries and chemical plants.

Now in its 29th year, MIT’s iconic entrepreneurship competition is run by MIT students and supported by the Martin Trust Center for MIT Entrepreneurship and the MIT Sloan School of Management. In the final round, eight teams pitched concepts to a crowded audience and to a judging panel of entrepreneurs and industry experts. Steve Conine, cofounder and co-chairman of e-commerce giant Wayfair was the keynote speaker.

Watch the Infinite Cooling video.

Read the MIT News article about Infinite Cooling’s 100K win.

Read MIT Sloan’s coverage of the event.

A Spinout with Olympic Impact

When the International Olympic Committee settled on Vancouver for the 2010 games, Bruce Dewar, MOT ’92, wanted to make sure the region could survive it. Host cities have suffered devastating economic fallout, and Dewar was determined that the Vancouver Games would give back to the community as much as it reaped.

As CEO of 2010 Legacies Now, he developed and supported projects to help British Columbia leverage the games to strengthen local communities—an effort that the International Olympic Committee has lauded as best practice. Today, seven years after the event, Dewar is still tapping the impact of the Games. In 2011 he launched a venture philanthropy organization called LIFT Philanthropy Partners that grew out of the new enterprise climate generated by the Olympic Games.

LIFT invests in building the capacity, sustainability, and impact of charities, nonprofits, and social enterprises working to remove barriers to health, education, and employment for vulnerable Canadians. Dewar, who is president and CEO, says that LIFT is improving the fabric of society. “We’re building self-sufficiency. We’re building confidence. We’re building support networks.”

Continue reading

Social responsibility must be a team effort

You’re a founder of a new enterprise and one of your top priorities is social and environmental responsibility. Your management team, however, can’t think of anything but the balance sheet.  By year’s end, your bottom line is healthy, but you don’t feel your new enterprise has contributed much to society.

It’s a common dilemma that comes down to a core disconnect that many founders don’t think to look for when pulling together their C-suites. But compatibility surrounding worldview, ethical issues, and dedication to social responsibility can be as important to the success of a business as professional qualifications.

Gustavo Mamão, SF ’11, founder of the Brazilian startup Flourish, which guides entrepreneurs in the creation of mission-driven organizations, has always focused on businesses that demonstrate how a company dedicated to a better world can also be profitable. But it’s an ethic, he says, that the whole management team must get behind. “The extent to which a business embraces sustainability and environmental goals is something that should be decided among founders and investors in the earliest days of the enterprise.”

Continue reading

What’s in that apple? Elif Buluç can tell you.

Don’t think that digital tools can bring you closer to nature? Elif Buluç SF ’08, might be able to convince you otherwise. Buluç is CFO of Anadolu Etap, Turkey’s largest fruit producer and distributor. The company processed 162,000 tons of fruit last year purchased from 150,000 farmers in 3,000 villages across the country. It’s also the first Turkish agribusiness executing its operations within the framework of sustainable agriculture principles.

elifBuluç says that software innovations are making it possible for Anadolu Etap to disclose the specific origins of every piece of produce it brings to market. “The only way to better know the provenance of a piece of fruit is to pick it yourself,” she says. The company worked with a digital development firm to create a revolutionary new enterprise resource planning (ERP) software system that gives the company the ability to monitor every aspect of the growing and processing of fruit.That traceability means that the company—and its consumers—are able to learn where and how the fruit or fruit product was produced.

“Knowing the origins of what they’re eating is important to today’s consumers,” Buluç says. “They worry about safety—especially the safety of the fruit, juice, and baby food they feed their children. Every step of our growing process is digitally recorded, so we can vouch for the full life cycle of every single piece of fruit. That makes full disclosure possible and gives our customers a sense of comfort.”

Monitoring the life cycle of a piece of fruit

The ERP system integrates information from three business units: operating plantations for the growth of fruit (more than 100 varieties), producing processed fruit for the makers of fruit juice and baby food, and selling fresh fruit for consumption. The analysis it generates informs management about the production of every piece of fruit at every plot at every Anadolu Etap plantation as well as the costs and outcomes of production, how much labor was used to produce each crop, climate conditions, and other essential metrics. “We can compare and contrast the success of various methods of planting and processing and quickly course-correct when necessary,” Buluç says. “We learn something every day that allows us to maximize our harvests, boost our productivity, and design new plantations with those lessons in mind.”

Buluç says that she has new reasons to be excited every day about the advances Anadolu Etap is able to achieve because of the continual flow of digital knowledge. “When people think digital, they think it’s a substitute for the human factor. But our digital tools have everything to do with the human factor. They connect the entire Anadolu Etap family, from climate scientists and agronomists to workers in the fields and processing plants. Everyone is part of this network—including the consumer. It’s now possible for us to draw a direct line from the farmer to the consumer. When someone eats a pomegranate that we grow, they know exactly which little rural farm brought it to life.”

Read more about Anadolu Etap’s digital quality control system.

Moving a company forward with system dynamics

Patricia Winand, SF ’13, Senior VP of Sales & Marketing, Americas at Close the Loop, first started ruminating about loops when she studied system dynamics (SD) as an MIT Sloan Fellow. “For me, SD was love at first sight because I am a very spatial person, and my brain responds best to visual stimuli. The graphic explanation of a complex problem makes it so clear.”

Ctl1The beauty of system dynamics, Winand says, is that it is a wise combination of simplicity and analytical power. But although she enjoyed learning the technique, she wasn’t sure she knew how she might use the tool in the real world. “The professor who taught the course was a master at the subject, but my million-dollar question was: how can a mere mortal do it?”

After graduation, Winand realized that, indeed, system dynamics could be second nature. She found that the course had changed her mindset and that she was using SD automatically when analyzing problems and identifying their root causes. Then she joined an Australian-based company called Close The Loop (CtL), which seemed like kismet, given that it was all about loops—in this case, the recycling loop. CtL turns used printer cartridges into other products.

Continue reading